© Reuters
Investing.com – Gold’s record rally is expected to continue, especially as investors brace for interest rate cuts – but analysts say it looks well positioned to outperform the yellow metal in the second half of the year.
The spot rises during these moments of today’s trading by 0.3% to $2164 per ounce.
Meanwhile, spot silver prices are now 0.65% higher at $24.29. The contract, which rose more than 5% last week, settled on Thursday at its highest level since late December.
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Precious metal prices have risen in recent weeks amid growing expectations of a cut in US interest rates. Federal Reserve Chairman Jerome Powell said Thursday that inflation is “not far” from where the central bank needs to be to start cutting interest rates.
Gold, usually considered a “safe haven” asset in times of financial uncertainty, rose despite higher interest rates and a relatively strong US dollar.
“What you need to come back to next is to find out the reason behind those rises, and I think here, the reason is expectations of interest rate cuts,” Marcus Garvey, head of commodity strategy at Macquarie, told CNBC.
Garvey said near-term US jobs and inflation data could determine whether gold prices, which he described as “resilient” so far, rise to 2,300 or fall to around $2,100.
Garvey added: “In terms of silver, as a dual precious metal and industrial metal, if we start to see global growth pick up a little bit more over the course of this year — which is pretty much our baseline forecast — then I would expect silver to be relatively outperforming gold, being relatively outperforming over the course of this year. The third and fourth quarters of this year.
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Silver year
Gold and silver prices have traditionally shown a strong positive correlation, although silver is sometimes described as the “poor cousin” of gold.
Earlier this year, the Silver Institute said in a report that global demand for silver is expected to reach 1.2 billion ounces in 2024, recording the second highest level ever.
The institute, an international non-profit association made up of various members of the silver industry, told CNBC last month that it expects silver to have a “terrific year,” especially in terms of demand.
Silver is primarily used for industrial purposes and is commonly incorporated into the manufacture of automobiles, solar panels, jewelry, and electronics.
“That’s what usually happens with silver: It moves with gold, but it moves later,” Randy Smallwood, CEO of Wheaton Precious Metals, told CNBC in early February. Adding: “Gold will rise first and then you will see silver take off. Silver always outperforms.”
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2024-03-14 03:32:06
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